The Key to True Fleet Optimization

The Key to True Fleet Optimization

Mar 31, 2017

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Identify the “what” but focus on the “why”.

More than ever before, companies are exploring solutions such as Fleet Management Programs to drive down costs associated with their lift truck fleets as well as other material handling equipment. Unfortunately, many of these organizations are focusing solely on the traditional maintenance cost component that identifies the “what” aspect of their cost drivers but not the “why” and therefore missing key opportunities to realize much larger returns.

To illustrate this point I am reminded of a story that is commonly used in discussing the “5 Whys” concept which is a technique used to explore the cause-and-effect relationships underlying a particular problem. The primary goal of the technique is to determine the root cause of a defect or problem by repeating the question “Why.”

The “what” or otherwise known as the problem: One of the monuments in Washington D.C. is deteriorating.
1. Why is the monument deteriorating? Because harsh chemicals are frequently used to clean the monument.
2. Why are harsh chemicals needed? To clean off the large number of bird droppings on the monument.
3. Why are there a large number of bird droppings on the monument? Because the large population of spiders in and around the monument are a food source to the local birds.
4. Why is there a large population of spiders in and around the monument? Because vast swarms of insects, on which the spiders feed, are drawn to the monument at dusk.
5. Why are swarms of insects drawn to the monument at dusk? Because the lighting of the monument in the evening attracts the local insects.

Solution: Change how the monument is illuminated in the evening to prevent attraction of swarming insects.

Although this example is not directly related to material handling equipment, the “5 why” concept is. If the people responsible for maintaining the monument never looked past the first “why” they may have spent millions of dollars on replacing the deteriorating monuments only for the problem to come back again. This is a scene that frequently plays out in a similar way when looking at traditional Fleet Management Reports.

One of the functions of a traditional Fleet Management Program is to report on the maintenance cost and frequency data that has been compiled over a given time period. This information is then typically used to help identify the top cost drivers related to the fleet, which not only includes things like which sites have the highest costs, but in some cases can also drill down further to itemize what specifically are the main contributors driving these costs. Ultimately, a very specific determination can be made as to “what” exactly are the main drivers.

Although the “what” is important information to have, it is more important to understand the “why”. This is an absolutely critical step if the ultimate goal is to reduce costs and it is the differentiating factor between a traditional Fleet Management Program and a Strategic Fleet Management Program.
Below is a real-life example of how the “5 Whys” concept can be applied to a distribution environment while analyzing fleet maintenance costs.

The “what” or otherwise known as the Problem: the primary cost driver related to their fleet was associated with excessive battery maintenance.

1. Why are our battery maintenance costs so high? Because our batteries are old.
2. Why are our batteries so old? Because our lift trucks are old.
3. Why are our lift trucks old? Because they still run at optimal capacity so an upgrade is not warranted.
4. Why are we placing service calls for batteries if our trucks are running in optimal condition? Because the forklift operators don’t know how to appropriately charge the batteries and are making unwarranted service calls.
5. Why are our forklift operators not trained to appropriately care for the batteries? Because we never trained them or gave them the tools to troubleshoot before making a service call.

This is an electronic checklist used PRIOR to calling in a local service provider. As a result they were able to reduce the frequency of calls by performing some simple steps on their end prior to having a service tech drive to their site.

In short, this customer was placing service calls that were unwarranted. Which was the root cause to their “battery issues” and was identified during a deep analysis of root cause analysis to determine the “why” side of this issue.

After determining root cause, they were able to implement a real-world solution to the ongoing battery issues at this site. The best thing about the solution was the cost to implement was exactly zero dollars but saved them thousands of dollars.

Overall, determining root cause for why costs are what they are is truly the idea behind using analytics for your lift truck fleet. Only determining the “what” is just part of the puzzle and not the overall picture.